New projects agts — impact on future staff — battle looms

Analysis

New projects agts — impact on future staff — battle looms

A major construction business is appealing a Fair Work Commission decision that could prevent the company from negotiating agreements with a small number of employees on new projects and then applying the agreement to future staff.

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A major construction business is appealing a Fair Work Commission decision that could prevent the company from negotiating agreements with a small number of employees on new projects and then applying the agreement to future staff.

The Australian Financial Review (AFR) has reported that Leighton Holdings’ John Holland division is the key party, but the ruling seems to have a wider-range impact on construction and resource companies that rely on enterprise bargaining agreements negotiated at the start of a project that can then be applied to a broader workforce once the project grows.
 
Wider application

AFR reports that employers are concerned they may have to bring unions to the negotiation table at the start of a project, even if their employees are not union members, begin operations without a formal agreement and negotiate one when the workforce expands or renegotiate agreements as a project develops.

Background

The decision in September 2012 puts a stop to the convention in the resources and construction sectors to form agreements with a selection of employees at the beginning of start-up projects that apply to all future employees.

John Holland made an agreement with three employees at the beginning of its development of the new children’s hospital in Perth early last year. Among its terms was that the agreement should apply to all its employees in building or civil construction work in Western Australia, including future employees, except those covered by separate agreements for particular sites or projects.

Fair Work Australia had ruled  that the group of employees negotiating the agreement was not fairly chosen and said it was concerned that other employees would be covered by the agreement without having had a say in its negotiation.
 
This decision is now on appeal.
 
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